In a 4-1 vote, the Ashe County Board of Commissioners approved a ballot initiative which will allow county voters to decide if the county will levy a one-quarter cent per dollar sales tax on the ballot this November.
Commissioners Judy Porter Poe, Gerald Price, Larry Rhodes and Gary Roark voted for the measure with Commissioner William Sands voting against it.
“The Commissioners do not have the authority to add (the tax) alone,” said Ashe County Manager Sam Yearick. “It has to be voted on by the people on whether they want it.”
The money generated by the county with the addition of the tax would be used to help with Ashe Memorial Hospital and Ashe Public Schools with monies they are requesting from the county.
“The property tax comes 100 percent from the people of the county, in other words you have to have property here in order to pay the tax,” Yearick said. “Whereas the sales tax, any tourist that comes through and buys something in our county will actually be contributing a little extra, helping us pay that one piece of the county tax.”
On the November ballot, the question will be posed as: “ FOR  AGAINST Local sales and use tax at the rate of one-quarter percent (0.25%) in addition to all other State and local sales and use taxes.” Again, the sales tax would be applied to one-quarter percent of a penny per dollar, meaning for every $4, a penny would be levied on the final charge.
If a bill totaled $100, the addition of the proposed sales tax would bring the total cost to $100.25.
“I would dare to say that anytime the Board (wants to) change (using the tax..you could),” Yearick said. “Of course if you are using it for a debt service on something, it cannot be changed until that debt service is paid off.”
According to the resolution, the county sales and use tax would help prevent an increase in property taxes for homeowners and local businesses.
Items such as clothing and prepared food would be taxed if the bill were to pass. Other items such as groceries and gasoline would not be applied to the proposed sales tax increase.
In addition, the bill would not apply to items such as houses, electricity, telephone bills, automobiles or airplanes which are already set at a capped rate.
Yearick said he believes the implementation of the sales tax would bring in an additional $500,000 yearly to the county.
“To put that in perspective, our tax base is a little over $4 billion, so one penny on the (ad valorem) tax rate brings in about $400,000,” Yearick said. “So it’s a good bit of money and it is relatively painless.”
Commissioner Larry Rhodes said before the issue is voted on by the public in November, there needs to be more clarification on the tax itself.
“Again, they are voting on (the tax) being (levied) in Ashe County,” he said. “The advantage of it is that it’s the tourism coming in and spending, it’s not like a normal tax… I just feel like we need to be a little more definitive about what this tax is and to let the public know.”
Yearick said the citizens of Ashe County are currently receiving over $400 in benefits from the current sales taxes being paid by tourists to the area, and the passage of the referendum would increase those benefits.
As of November 2013, 26 counties have approved the measure, including Alexander and Wilkes counties. In addition to Ashe County, Brunswick and Davidson counties have also placed the referendum on the ballots for November 2014.
Ashe Memorial Hospital
Yearick in the meeting mentioned Ashe Memorial Hospital would be asking the county for money in the coming months to help pay previous debts. Yearick said the approval of this sales tax could help the county with those monies.
“I’ll be honest with you, if you’re asking me as the County Manager, first off it’s good to be close to the hospital, second it adds a lot of value when we talk about building homes here for retirees,” he said. “Most retirees want to be close to a hospital. Personally I like to be close to one. It’s a difficult situation and if you look around at the options we have, this (sales tax) is a very good option.”
Ashe Memorial opened its doors in 1941 and moved to its present location in the 1970s. In August 2013, Winston-Salem based Novant Health began providing management services to the hospital.
“It’s a very unstable time in healthcare right now,” said Laura Lambeth, CEO of Ashe Memorial Hospital in a Tuesday, April 22 interview. “Certainly, with Ashe’s association with Novant Health, that helps this organization to move forward in the future. They have invested hundreds of thousands of dollars in cost savings here, so there are a lot of things going on. No one thing is helping us with the whole picture.”
Lambeth said small, rural, critical access hospitals, such as Ashe are struggling with the declining reimbursements from Medicaid and Medicare and the hospital’s move to provide charity care to those who are unemployed or without health insurance. Since 2009, through charity care and bad debt patients, Ashe Memorial provided approximately $3.5 million in health care for which they were not reimbursed by patients, private insurance or the state and federal government.
“We’re really not that different from any other hospital in the country right now,” Lambeth said. “We approached Sam Yearick about a subsidy for the county for the next couple of years to help us get this facility financially stable. So that is what we’re facing, nothing hidden here.”
Joe Thore, the Chief Operating Officer for Ashe Memorial said the hospital needs the county’s help to help maintain quality care in the county.
“We’ve struggled for years now and this is something you’re not going to get over quickly,” he said. “We’ve got a lot of good things in place, but you’ve got to start taking care of a lot of the past deficits we are in. We need that boost to help us.”
Ashe Memorial is the county’s third largest employer, staffing 220 full-time employees with additional part time and PRN workers. Lambeth said there has been no layoff and she does not expect there to be any.
“I’m proud to say we have not had to have a layoff, and we don’t want to,” she said. “I think we are well on our way, where we will avoid that.”
The hospital is asking for approximately $500,000 and implementing the sales tax, if approved by voters, will help the county provide Ashe Memorial Hospital the money needed.
“I think (the tax) might be the best way to do it,” Lambeth said. “You have people outside of Ashe County that are contributing to that sales tax and the burden is just on the citizens of Ashe County.
While the times are difficult, the hospital is working to stay afloat. The money they are asking would be a temporary boost to get over a bump placed on it before being taken over by Novant, where the facility could pay down previous debts.
“Can you imagine if something were to happen to this hospital, and there was no hospital in Ashe County and we had one of those severe winters where you could not get off the mountain? That would be devastating for this community,” Lambeth said. “(Closure) is not an option to us.”
Lambeth said the hospital turns nobody away from receiving medical care.
“People who are unemployed and don’t have health insurance, we don’t turn anybody away,” she said. “The people with the bad debt, a lot of times, when you have to choose, are you going to pay a hospital bill or are you going to buy food?”
Prior to the voting the Commissioners discussed where one another stood on the passing of this resolution.
“All we are doing here is asking for it to be put on the ballot,” said Vice Chair Judy Porter Poe. “There is nothing that we can say or do that would tie up any future board. I could sit here and say I would like to give part of this to the hospital and part of this to the school system for technology, but as far as tying it up for any future amount, I can’t, except for one year.”
Poe said she was going to support the ballot because it would then be up to the people of Ashe County to make the decision.
“I would just like to say to the public, the county commissioners and the county manager, we have talked to the hospital and we know some of the problems they are having and they are working on their problems,” she said. “Ashe County is not the only county, Alleghany has been giving money to their hospital. Watauga is having problems with their hospital too. It is something that if we want a hospital in our county, we’re going to have to work (together) on it.”
Poe also said with state and federal cuts across multiple entities, Ashe County was going to have a tough budget year.
Sands said while the sales tax would be the best way to go, he did not believe now was the best time to send the measure to a vote.
“I for one am not too comfortable with doing this right now,” he said. “There are just too many uncertainties right now.”
Board Chair Gary Roark also stated his support for the referendum, saying the county’s citizens needed to decide between a one-quarter cent per dollar sales tax increase or facing an increase in property taxes.
“If you implement this tax, you’ll be getting taxes from people who have been getting a free ride over the last 10 years … plus you’ll be getting money from Watauga, Tennessee, Virginia people who come to West Jefferson everyday to spend money,” he said. “It is our basic duty to give the public the opportunity to make up their mind, so I support this 100 percent.”
County Manager Yearick said it is important that the county does everything it can to keep the hospital open.
“The issue seems to be that most hospitals around are trying to operate on Medicaid or Medicare reimbursements and those are just really tough to try and make it on,” he said. “It’s good to have a hospital around. (The proposed sales tax) is one where people who visit our area, help pay our taxes. The more people visit the more this tax is going to help us.”
In other action taken by the Board:
• The Board were updated on the gun laws within Ashe County Parks by County Attorney John Kilby. No motion was made and the item was rescheduled for discussion.
• The Board voted to reschedule discussion of the Ashe County Whistleblower policy for the May 5 meeting.
• Board approved providing $4,300 for repairs to the roof of the Riverview Community Center in Creston.
• In attendance were: Commissioners Larry Rhodes, William Sands, Gary Roark, Gerald Price and Judy Porter Poe. The next meeting will take place on Monday, May 5.